Collection law firm Frederick J. Hanna & Associates on Wednesday agreed to pay $3.1 million to settle a Consumer Financial Protection Bureau lawsuit that alleged the firm illegally operated a debt collection lawsuit mill, CollectionsCreditRisk.com reported yesterday. The CFPB’s proposed order, filed yesterday in federal court, accuses the Georgia-based firm and its three principal partners, Frederick J. Hanna, Joseph C. Cooling and Robert A. Winter, of using deceptive court filings and faulty evidence to churn out debt collection lawsuits. The CFPB's lawsuit was filed in July 2014 in federal court in the Northern District of Georgia. The order, if approved by the court, would bar the firm and its partners from filing lawsuits without being able to verify the consumers’ debt is owed and from intimidating consumers with allegedly deceptive court filings — including those that appeared like they were signed by an attorney when they actually involved the work of non-attorney staff. "This process allowed the firm to generate and file hundreds of thousands of lawsuits," the CFPB said. "One attorney at the firm, for example, signed over 130,000 debt collection lawsuits over a two-year period." The agency also accused the law firm of filing sworn statements from its clients who attested against a consumer with outstanding debt even though some of the clients could not have known such details.
